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                                                                   Exhibit  10.9


     The following amendments to the referenced sections of the 1992 Director
Stock Option Plan were adopted by the following amendments to the referenced
sections of the Board of Directors of Arcadia Financial LTD. Effective as of
January 29, 1998:

     4 (b)     Commencing with calendar 1998, each Outside Director shall be
               automatically granted an option to purchase that number of Shares
               determined by multiplying 25,000 times a fraction, the numerator
               of which is the number of days from the grant date to the next
               successive January 28th and the denominator is 365 (the "First
               Option") upon the date on which such person first becomes an
               Outside Director, whether through election by the shareholders of
               the Company or appointment by the Board to fill a vacancy;
               provided, however, for the calendar years prior to 1998 such
               automatic grant shall be of an option to purchase 15,000 shares
               (except for calendar year 1996 for which the grant shall be an
               option to purchase 5,000 shares).
     
     4 (c)     Subject to the following, after the First Option has been granted
               to an Outside Director, such Outside Director shall thereafter be
               automatically granted an Option to purchase 25,000 Shares on
               January 28th of each successive year.  Provided however, for the
               calendar years prior to 1998 each Outside Director shall be
               automatically granted an Option to purchase 15,000 shares on each
               successive anniversary of the grant of the First Option (except
               as to calendar 1996 as to which the automatic grant shall be of
               an option to purchase 5,000 shares).  Notwithstanding the
               foregoing, that in no event shall an Outside Director be granted
               options to purchase in the aggregate more than 250,000 shares
               pursuant to the Plan.

     11.       NON-TRANSFERABILITY OF OPTIONS.  Without the prior written
               consent of the Board, the Option may not be sold, pledged,
               assigned, hypothecated, transferred, or disposed of in any manner
               other than by will or by the laws of descent or distribution and
               may be exercised, during the lifetime of the Optionee, only by
               the Optionee.

     12.       [First paragraph unchanged.] [second paragraph:]  In the event of
               the proposed dissolution or liquidation of the Company, each
               Option will terminate immediately prior to the consummation of
               such proposed action, unless otherwise provided by the Board. 
               The Board may, in the exercise of its sole discretion in such
               instances, declare that any Option shall terminate as of a date
               fixed by the Board and give each Optionee the right to exercise
               his or her Option as to all or any part of the Optioned Stock,
               including Shares as to which the Option would not otherwise be
               exercisable.  In the event of a proposed sale of all or
               substantially all of the assets of the Company, or the merger of
               the Company with or into another corporation, the Option shall be
               assumed or an equivalent option shall be substituted by such
               successor corporation or a parent or subsidiary of such successor
               corporation.